PI Berlin examines risks facing PV projects in India

Study finds that “the Indian market is a double-edged sword”

The Indian market is one of the most profitable yet risky for project developers and investors in photovoltaics (PV). While large-scale projects of over 100 megawatts (MW) are now common, the investment risks caused by the climate, poor installation and lack of proper maintenance is on the rise. In a study conducted on behalf of the National Metrology Institute of Germany (Physikalisch-Technische Bundesanstalt – PTB), PI Berlin has recently examined the most common risks facing Indian PV projects and how they can be avoided.

Six PV projects in India were investigated between 3rd and 14th July 2017 for the purposes of the study. The study was conducted with the support of the Ministry of New and Renewable Energy (MNRE), the Indian National Institute of Solar Energy (NISE) and the Solar Energy Corporation of India (SECI). The German KfW Development Bank helped select which projects to analyse and assisted PI Berlin in gaining access to them.

PUBLIC_Pilot_Study_on_Quality_Aspects_of_PV_Power_Plants_in_India_

Posted in Cells & Modules, Crystalline, India, PV, Renewables, Solar, Solar PV, Thin Film | Tagged , , , , , , , , , , , | Leave a comment

Safeguard Duty Notified for Solar Cells imported into India from China PR and Malaysia

Updated: India’s Ministry of Finance has imposed a 25% safeguard duty on imports of solar cells and modules from Malaysia and the People’s Republic of China, starting tonight.

In keeping with the final recommendations proposed by the Directorate General of Trade Remedies (DGTR), the 25% duty will run for one year (from 30 July 2018 to 29 July 2019), then reduce to 20% for a six-month period (30 July 2019 to 29 January 2020), and to 15% for the final six-month period (30 January 2020 to 29 July 2020).

All levels of the duty will be imposed “ad valorem minus anti-dumping duty payable, if any” when imported during the relevant period, said the Gazette of India notification.

The notification stated: “Nothing contained in this notification shall apply to imports of subject goods from countries notified as developing countries vide notification No. 19/2016-Customs (N.T.) dated 5th February, 2016, except China PR, and Malaysia.”

Click here for the full notification

The Indian solar industry currently sources more than 90% of its cells and modules from China and Malaysia.

However, last week, major Indian PV developer Acme Solar received a stay order from the Orissa High Court regarding the imposition of the safeguard duty.

Chinese solar manufacturers still set to benefit from India’s safeguard duties

The Indian government imposition of 25% import duties on solar cells and modules from China and Malaysia to safeguard domestic manufacturers does not include solar cells and modules imported from Indonesia and Vietnam, due to being classified as ‘developing countries.’

Further checks have indicated that Thailand and Philippines would also be classified as developing countries and therefore excluded from the duties. This would assist companies such as leading ‘Silicon Module Super League’ (SMSL) member JinkoSolar, which has a major manufacturing operation in Thailand.

A number of Chinese PV manufacturers and other foreign suppliers have production operations in Indonesia and Vietnam, enabling them to supply solar products in India, without the import duty.

Leading integrated high-efficiency monocrystalline module manufacturer and ‘Silicon Module Super League’ (SMSL) member LONGi Green Energy Technology had already reignited previously suspended manufacturing plans in Andhra Pradesh, India.

LONGi is investing US$309 million, including around US$240 million in constructing a new facility with an initial nameplate capacity of 1,000MW of monocrystalline solar cells and expand its mothballed 500MW module assembly plant to 1GW.

Given the slim margins for suppliers into the Indian market, the exclusion from the safeguard duties could be a major competitive advantage over the next two years of the duties being imposed.

Further updates to follow.

Chinese PV manufacturers in Indonesia

Chinese and OEM PV manufacturers in Vietnam

Source: PV-Tech

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SoftBank, Actis, and CDC Group Companies Win SECI’s 750 MW Solar Auction

The Solar Energy Corporation of India (SECI) has auctioned 750 MW of grid-connected solar photovoltaic (PV) capacity to be developed at the Kadapa Solar Park in the state of Andhra Pradesh.

The capacity was tendered by SECI in January 2018 under the NSM Phase-II Batch-IV Tranche-XV.

In the SECI auction, ₹2.70 (~$0.039)/kWh emerged as the lowest (L1) tariff quoted. Both SB Energy and Sprng Soura Kiran Vidyut quoted the L1 tariff in the auction.

SoftBank, Actis and CDC Group Companies Win SECI’s 750 MW Solar Auction

When contacted, a SECI official confirmed the conclusion of financial bidding and said, “SB Energy Seven Private Limited quoted the L1 tariff to develop 250 MW. Sprng Soura Kiran Vidyut (Actis) also quoted a tariff of ₹2.70 (~$0.039)/kWh to develop 250 MW, Ayana Renewables quoted a tariff of ₹2.71 (~$0.0394)/kWh to develop 250 MW.”

ACME Solar and Fortum were the other bidders participating in the financial bidding. ACME quoted a tariff of ₹2.71 (~$0.0394)/kWh and Fortum quoted a tariff of ₹2.79 (~$0.040)/kWh to develop 250 MW each but could not win the auction.

SoftBank, Actis and CDC Group Companies Win SECI’s 750 MW Solar Auction

The L1 tariff quoted in this auction is ₹0.26 (~$0.003)/kWh, more than the recently quoted low tariff of ₹2.44 (~$0.035)/kWh in SECI’s recently concluded 2 GW solar PV auction.

Source: Mercom

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Impose 95 per cent safeguard duty on solar cells import: ISMA

Impose 95 per cent safeguard duty on solar cells import: ISMANew Delhi: Indian Solar Manufacturers Association (ISMA) has demanded imposition of 95 per cent safeguard duty on imports of solar cells and modules to protect domestic players from cheap inbound shipments.

The association put its demand during a public hearing called by the Directorate General of Trade Remedies (DGTR), under the commerce ministry, on the issue on Tuesday. The directorate heard different sections of solar energy sector on safeguard duty investigation of solar cells.

“According to the ISMA data submitted to the DGTR, the injury from solar imports is to the tune of 95 per cent and therefore ISMA sought the proportionate safeguard duty on the solar equipment imports,” ISMA Coordinator Dhruv Sharma said.

Sharma expressed hope that a decision would be taken by the authority by the middle of next month. The parties will submit their written submission tomorrow on which rebuttal can be submitted by July 2. Thus, a decision can be expected by middle of July.

However, according to Solar Power Developer Association, the imposition of safeguard duty can jeopardise India’s ambitious target of having 100 GW by 2022 as it would directly impact 25 GW capacity which either tendered or being tendered.

The ISMA in its submission has stated that India is missing out on a multi-billion opportunity for the country by allowing import of inputs from countries such as China, Taiwan and Malaysia.

“India is estimated to add capacity of 9,000 MW solar power in 2018. This means India will give away market opportunity worth Rs 21,500 crore to China, Taiwan or Malaysia at the cost of interests and employment of national capital and labour,” it said.

India is targeting 100 gigawatt (GW) solar capacity by 2022. Solar cells are electrical devices that convert sunlight directly into electricity, are imported primarily from China, Malaysia, Singapore and Taiwan.

Imports of the cells from these countries account for more than 90 per cent of the total inbound shipments in the country.

Source: ET

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Draft Amendments to Tariff Policy as of 30th May 2018

Proposed_amendments_in_Tariff_Policy

1.0 INTRODUCTION

Draft Amendments to Tariff Policy

MINISTRY OF POWER RESOLUTION
New Delhi, the 28thJanuary, 2016

TARIFF POLICY

As on 30.05.2018

  1. 1.1.  In compliance with section 3 of the Electricity Act 2003, the Central Government notified the Tariff Policy on 6th January, 2006. Further amendments to the Tariff Policy were notified on 31st March, 2008, 20th January, 2011 and 8th July, 2011. In exercise of powers conferred under section 3(3) of Electricity Act, 2003, the Central Government hereby notifies the revised Tariff Policy to be effective from the date of publication of this resolution in the Gazette of India.Notwithstanding Anything done or any action taken or purported to have been done or taken under the provisions of the Tariff Policy notified on 6th January, 2006 and amendments made thereunder, shall, in so far as it is not inconsistent with this Policy, be deemed to have been done or taken under provisions of this revised policy.
  2. 1.2.  The National Electricity Policy has set the goal of adding new generation capacity and enhancing per capita availability of electricity per year to not only eliminate energy and peaking shortages but to also have a spinning reserve as specified by the Central Electricity Authority. Development of the power sector has also to meet the challenge of providing access for to affordable electricity to all households in next five years.
  3. 1.3.  It is therefore essential to attract adequate investments in the power sector by providing appropriate return on investment as budgetary resources of the Central and State Governments are incapable of providing the requisite funds. It is equally necessary to ensure availability of electricity to different categories of consumers at reasonable rates for achieving the objectives of rapid economic development of the country and improvement in the living standards of the people.
  4. 1.4.  Balancing the requirement of attracting adequate investments to the sector and that of ensuring reasonability of user charges for the consumers is the critical challenge for the regulatory process. Accelerated development of the power sector and its ability to attract necessary investments calls for, inter alia, consistent regulatory approach across the country. Consistency in approach becomes all the more necessary considering the large number of States and the diversities involved.
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India won’t levy duty on solar gear imports

Bengaluru: The government has decided not to impose safeguards duty on solar equipment from China and Malaysia, overruling the directorate general of safeguards’ recommendation of a 70% levy that had delighted local manufacturers but alarmed developers who felt that the steep rise in input costs would make projects unviable.

The Delhi High Court disposed of a petition challenging the proposed duty after the government’s counsel said the directorate general of safeguards’ recommendation was not binding. The counsel showed the court confidential minutes of a meeting held by the standing committee on safeguards, which had decided not to impose the duty.

Anand Kumar, secretary, ministry of new and renewable energy, confirmed there would be no provisional safeguard duty. “As of now there will be no duty,” he told ET.

“If it ever comes up in future, we will make sure the interests of all stakeholders are safeguarded,” said Kumar.

In the high court, Justices Sanjiv Khanna and Chander Shekhar did not comment on the merits of the petition by Acme Solar and said it should be treated “as a representation to the respondents before the final decision is taken by the Central government”.

The judges remarked that the minutes of meeting suggested that no imposition of provisional duty was likely, and that if any such step was taken, Acme Solar could approach the court again with a fresh petition. “This order would not foreclose the right of the petitioner to challenge any adverse order in accordance with the law,” the court said.

The development comes as a huge relief to solar developers, since over 90% of the equipment used in Indian solar projects is imported.

Acme Solar, in its petition, had claimed that imposing the duty would increase solar tariffs from around Rs 2.50 per unit at present to around Rs 4.50 per unit, which would render their business unviable.

India’s solar power capacity has expanded rapidly in recent years, led by big investments by companies such as ReNew Power, Tata Power, Hero Future Energies, Greenko, Acme Solar and Azure Power. Relatively cheap imported equipment has helped Indian solar power tariffs plunge to a record at auctions.

The DG of safeguards had made his recommendation following a petition from the Indian Solar Manufacturers Association (ISMA), which claimed to represent local solar manufacturers, maintaining that Chinese and Malaysian solar panels were being priced lower than locally made equipment. Acme Solar’s petition had questioned the legitimacy of ISMA as a voice of local industry, claiming that many of its members had their units in special economic zones.

Earlier Shapoorji Pallonji Infrastructure too had moved the Madras High Court against the DG of safeguards’ proposal, claiming it had not been given enough time to respond during the investigation, but the petition was dismissed.

Safeguard duty — as distinct for anti-dumping duty — can be imposed on a product for a maximum of four years if its import increases unexpectedly to the extent that this causes serious injury to domestic industry. Separately, the director general of anti-dumping and allied services, is also investigating whether anti-dumping duty should be imposed on solar imports.

The manufacturers who filed the petition are Mundra Solar (part of Adani Group), Indosolar, Jupiter Solar Power, Helios Photo Voltaic and Websol Energy Systems.

Other manufacturers, who would have gained if a safeguards duty was imposed, include Vikram Solar, Waree Energies, Tata Power Solar Systems, Emmvee Solar Photovoltaic and Moserbaer Solar.

Source: ET

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BESCOM Proposes a Tariff Separation for Open Access Consumers Above 1 MW in Karnataka

Bangalore Electricity Supply Company (BESCOM) has proposed a separate tariff for >1 MW open access consumers, as it causes the non-recovery of fixed costs.

BESCOM has requested for an increase in charges for consumers of 1 MW and above with the goal of recovering fixed charges, as consumers try to find the cheapest variable rate available. Instead of eliminating the open access program, BESCOM has tried to recover more revenue from these consumers.

To calculate this tariff, BESCOM considered the existing approved rates for FY17 open access sales as base data to divide the demand and energy charges. Considering the existing approved rates of fixed and variable cost and based on the actual recovery during FY17, BESCOM says it has recovered only 11 percent of the cost through fixed charges with the remaining 89 percent recovered through variable charges.BESCOM Proposes a Tariff Separation for Open Access Consumers Above 1 MW in KarnatakaTo ensure the recovery of full fixed costs by reducing the energy charge, it is proposing to increase the fixed charges. BESCOM has also proposed to increase the billing demand to 85 percent of the contract demand or the maximum demand recorded, whichever is higher. BESCOM also wants to penalize proportionate consumption consequent to exceeding the contract demand.

Through this proposal, BESCOM is attempting to generate additional revenue from high tension (HT) consumers with contracted demand (CD) of 1 MW and above by encouraging them to consume over and above the average 12 months consumption through a concessional tariff rate. If >1MW consumers are attracted to this scheme, HT sales will go up, which in-turn would help BESCOM achieve its HT sales target approved by the KERC for the year. This is expected to have a positive impact on the cross-subsidy generation, which could then reduce the subsidy burden on state government for the respective year.

BESCOM is proposing having a separate tariff under both the HT and low tension (LT) category with a time of day tariff. Per the prevailing tariff structure, battery charging units are also being billed under a commercial tariff.

BESCOM also noted that the cross-subsidy surcharge calculated by Karnataka Electricity Regulatory Commission (KERC) and recovered from open access consumers is often insufficient to recover the entire loss of a cross subsidy.  Renewable purchase obligation (RPO) targets are also fixed to encourage solar energy. As solar generation has increased significantly since last year, BESCOM has a proposed levy of wheeling and cross subsidy surcharge for renewable energy, including solar energy.

Source: Mercom

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